<PAGE> 1
VAN ECK WORLDWIDE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
1997 SEMI-ANNUAL REPORT
Dear Fellow Shareholder:
The Van Eck Worldwide Emerging Markets Fund rose 22.9% during the first six
months of 1997, outperforming the Morgan Stanley Capital International (MSCI)
Emerging Markets Free Index (+17.8%) and the Lipper Emerging Markets Fund Index
(+17.9%). This strong performance was due principally to our emphasis early in
the year on the Brazilian and Russian markets and participation in Hong Kong's
strong second quarter recovery.
The year started very positively with emerging markets seeing strong gains.
These slowed in February and reversed in March and April as the threat of rising
U.S. interest rates materialized. However, by May U.S. growth had slowed and the
interest rate outlook had become more benign. This gave both local and foreign
investors confidence that the global backdrop would remain supportive and most
markets saw significant rallies.
Eastern Europe continued to lead, spurred by the prospects of economic recovery
and cheap valuations: Russia rose 118% and Hungary, 56%. The Fund had a
significant weighting in this region, particularly in Russia. Russia has made a
great deal of progress since Yeltsin's recovery from his heart operation. This
year, Yeltsin appointed a reformist cabinet to restructure the tax system, clear
wage arrears and restructure the natural monopolies. So far, the government has
collected a good portion of overdue taxes, paid much of the wage backlog and
encouraged utilities to give discounts for cash payments of debts. Falling
inflation has led to a steep decline in interest rates and economic growth is
turning positive. Asset valuations are still far below comparables in the
developed world and we are confident this discount will narrow. Sector emphasis
in Eastern Europe includes energy and telecommunications in Russia and
pharmaceuticals in Hungary.
Latin America also performed well as the region's economies continued to
recover. The Brazilian market rose 54%, stimulated by the passage of a
constitutional amendment enabling the reelection of President Cardoso. His
success in combating inflation via the Real plan has enabled progress on tariff
rebalancing (an adjustment of telephone usage billing) and privatization in the
public sector. The Fund's weighting in Brazil is largely focused on public
sector companies, particularly electricity and telecommunications.
Telecommunications tariff rebalancing and increased traffic has resulted in
strong profit gains for Telebras, the Fund's largest holding, as well as for
Telerj and Telepar, other Fund positions. In addition, the results of several
electricity companies that are already privatized provide evidence of the
efficiency gains possible from privatization. These gains, on top of rising
tariffs, are contributing to sharply rising profits in the electricity sector as
well. Chile rose 32% as local interest rates have been trending downwards.
Mexico, Argentina and Peru are all seeing stronger economic growth after
recessions induced by the Tequila crisis (the Mexican peso devaluation of 1994).
Elsewhere in Latin America, the Fund is focused on consumer and financial
stocks.
In the Middle East, the Fund has focused on the NASDAQ-listed, Israeli-domiciled
pharmaceutical and technology sectors. Israel performed well despite the stalled
peace talks, rising 26% as the government reduced its budget deficit and
interest rates and inflation trended lower. Egypt (+24%) started the year
strong, but lost a little ground in the second quarter as the government slowed
down the pace of privatization.
Asia has had mixed performance over the past six months. Politics were a
non-issue, generally. The handover to China actually improved the prospects for
many Hong Kong blue chip companies, with many China-backed "red chips," some of
which the Fund owns, performing spectacularly. Despite the rioting shown on
television, the Indonesian elections created nothing more than a six-week fall
in the market, which was quickly recouped over the following six weeks. In
India, the fall of the Gowda Government did not signal any significant changes
in government policy and the market rose strongly. Korean politics were as
tumultuous as ever, with high profile arrests, bankruptcies and student
demonstrations, but the bad news was already in the market and it rose, in fits
and starts, by over 11%.
<PAGE> 2
In Thailand, a new Finance Minister floated the baht (Thailand's currency) and
the market fell sharply (-36%). The dollar's decline since 1985 resulted in
booming exports for many of the Southeast Asian economies, all of whose
currencies are targeted against the dollar. This dollar link led to too much
borrowing of relatively "cheap" dollars, leading to overcapacity, especially in
the property sector. Trouble arose when central banks tightened the screws to
reign in domestic growth just as exports to the developed world slowed
significantly. Higher interest rates and slower exports lead to slower
economies. In Thailand's case, a property bust and a move to a floating currency
ensued. The Fund's allocation to Thailand is very low at approximately 0.5% of
assets.
With the exception of Malaysia, the currency problem is not acute in the rest of
the region. Singapore's currency floats freely and has appreciated over the last
several years. We expect the Philippine peso to begin to float as well and a
large depreciation is not necessary given that exports are growing strongly.
Listed property developers are not highly leveraged and overseas worker
remittances largely cover the trade deficit. The Indonesian rupiah is already
moving in a steady depreciation against the dollar, which goes a long way toward
covering the inflation differential.
The outlook for emerging markets remains positive. Economic growth in Eastern
Europe and Latin America is sufficient to keep pressure off reformist
governments, yet not so strong as to threaten overheating. In Southeast Asia, a
new export cycle this fall should provide the ingredient missing so
far--liquidity. The move to floating exchange rates will allow greater
flexibility for monetary policy and result in the better use of capital in the
future. In Greater China and India, liquidity conditions are in place for
continued strength. The possibility of an exogenous shock is always present,
especially as markets move to discount good news. However, currently emerging
market valuations are fair and earnings are improving against a background of
declining interest rates.
We appreciate your participation in the Worldwide Emerging Markets Fund and look
forward to helping you meet your investment goals in the future.
<TABLE>
<S> <C>
Gary Greenberg
Portfolio Manager
July 23, 1997
</TABLE>
- ---------------------------------------------------------
PERFORMANCE RECORD AS OF 6/30/97
- ---------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL
TOTAL RETURN
<S> <C> <C>
- ---------------------------------------------------------
Life (since 12/27/95) 33.3%
- ---------------------------------------------------------
1 year 32.1%
- ---------------------------------------------------------
Year-to-date* 22.9%
- ---------------------------------------------------------
</TABLE>
The performance data reflects past performance and is not indicative of future
results. Investment return and principal value of an investment in the Fund will
vary so that shares, when redeemed, may be worth more or less than their
original cost. These returns do not take variable annuity/life fees and expenses
into account.
* not annualized.
<PAGE> 3
VAN ECK WORLDWIDE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
TOP HOLDINGS AS OF JUNE 30, 1997*
TELECOMUNICACOES BRASILEIRAS S.A.
(TELEBRAS)
(BRAZIL, 4.5%)
Telebras is the monopoly telephone operator in Brazil for both cellular and
fixed line. Brazil has a very low penetration of telephone lines per capita
making this a strong growth industry. The government has rebalanced tariffs to
bring them into line with international norms. Telebras is seeing major
improvements in profitability levels from this rebalancing and considerable cost
savings from staff reduction. Telebras is valued at a discount to other Latin
American telecom companies and should be fully privatized within the next
several years.
TEVA PHARMACEUTICALS INDUSTRIES LTD.
(ISRAEL, 3.5%)
Teva is the largest company in Israel by market capitalization. Moreover, it is
a world-class drug producer little affected by the vagaries of the peace
process. Teva's multiple sclerosis drug, Copaxone, was recently launched in the
U.S. and early indications of patient response are encouraging. Teva took over
U.S. drug producer Biocraft in 1996 to acquire a more significant presence in
the U.S. market. The company is also negotiating with European distributors to
strengthen its network in Europe and has acquired companies in the UK and
Hungary.
GRUPO FINANCIERO BANCOMER S.A.
(MEXICO, 2.7%)
Bancomer is Mexico's second largest bank, with "associates" (companies of which
Bancomer holds 20% to 50%) in insurance, asset management and other financial
services. Widespread loan default in the Mexican banking system last year
resulted in a government bailout of the banking sector. Since then, the bank has
been recapitalized and most loans have been restructured. Accounting regulation
changes have brought more transparency to Mexican bank financial statements. The
company is also part of a consortium providing long distance telephone service
in Mexico and has the largest market share in the nascent private pension fund
industry. The Mexican banking sector currently trades at around a 25% discount
to the Latin American average.
CHINA LIGHT & POWER COMPANY LTD.
(HONG KONG, 2.5%)
China Light & Power (CLP) has a monopoly on power distribution in Hong Kong's
New Territories and the Kowloon Peninsula. Its profits are governed by a scheme
of control that is related to its capital expenditure. CITIC Pacific, a Hong
Kong-listed company controlled by the Chinese government, owns a 20% stake in
CLP. CLP is already involved in power projects in China, India and Taiwan.
BANCO FRANCES DEL RIO DE LA PLATA S.A.
(ARGENTINA, 2.5%)
Banco Frances is the second largest private bank in Argentina with approximately
5% of the country's loans and deposits. Previously emphasizing corporate
borrowers, Frances is now focusing on higher margin consumer lending as the
decline in inflation and subsequent economic recovery leads to an increased
number of bank customers. In 1996, Banco Bilbao Vizcaya of Spain took a 30%
stake as part of its Latin American expansion strategy. This will give Banco
Frances additional management expertise and capital resources. A recent merger
with Banco Credito Argentino has also strengthened Frances' position, providing
a good strategic fit, increasing the branch network and the customer base.
CREDICORP LTD.
(PERU, 2.4%)
Peru's largest provider of banking, insurance and other financial services,
Credicorp should see significant loan demand as the Peruvian economy is growing
in excess of 5% per annum. Credicorp is well capitalized and has low levels of
non-performing loans, leaving it well positioned for expansion. Its insurance
business is 20% owned by AIG. Peru has a low penetration of banking services,
providing growth opportunities for the industry.
<PAGE> 4
FOMENTO ECONOMICO MEXICANO, S.A. DE C.V.
(FEMSA)
(MEXICO, 2.3%)
Femsa has four main areas of business: soft drink bottling, brewing, packaging
and convenience stores. Femsa has a bottling joint venture with the Coca-Cola
franchises for Mexico City and Buenos Aires. The beer division is seeing rising
volumes as a result of Mexico's economic recovery. The packaging division claims
to be the most efficient in Latin America and the convenience stores are
expanding steadily.
BANCO ITAU S.A.
(BRAZIL, 2.2%)
Brazil's third largest private bank, Banco Itau recently became the first
Brazilian bank to report in accordance with U.S. accounting standards. This has
increased the transparency of its accounts considerably and is the first stage
toward a listing on the NYSE. Banco Itau recently acquired Banerj, a bank in Rio
de Janeiro, which complements its existing branch network, and acquired an
insurance business from its parent that broadens its range of financial
products. Brazilian banks generally will see increasing demand for loans as
interest rates come down and Banco Itau's strong capital base enables it to take
advantage of such opportunities.
SURGUTNEFTEGAZ
(RUSSIA, 2.0%)
Russia's second largest integrated oil and gas production company, Surgut trades
at a large discount to similar Western companies. Surgut exports approximately
one third of its production, providing foreign exchange for investment. As the
Russian economy regains liquidity, Surgut will be able to develop its reserves,
which should highlight its hidden value.
KIMBERLY-CLARK DE MEXICO S.A.
(MEXICO, 2.0%)
Kimberly-Clark's Mexican operations have seen a substantial expansion of
capacity and market share as a result of the worldwide merger with Scott Paper.
The combined entity controls between 60% and 90% of the market in its core
segments of bathroom and facial tissues and paper products.
* Portfolio is subject to change.
Note: Equities listed as percentage of total net assets.
<PAGE> 5
WORLDWIDE EMERGING MARKETS FUND
STATEMENT OF NET ASSETS
JUNE 30, 1997 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE
COUNTRY SHARES SECURITIES (A) (NOTE 1)
------------------------------------------------------------
<C> <S> <C>
ARGENTINA: 3.2%
102,195 Banco Frances del Rio de la
Plata S.A. (ADR) $ 3,321,338
62,570 IYE de la Patagonia (Class B) 919,912
------------
4,241,250
------------
BRAZIL: 12.3%
5,130,000 Banco Itau S.A. Pfd. 2,902,290
19,766,000 Cia Eletricidade de Bahia 1,819,695
101,400,000 Cia Paranaense de Energa Copel 1,808,612
74,000 Petroleo Brasileiro S.A. (ADR) 2,053,500
3,040,000 Petroleo Brasileiro S.A. 844,433
84,288 Telecomunicacoes do Parana
S.A. Receipts Pfd. 55,124
1,010,000 Telecomunicacoes do Parana
Pfd. 750,615
258,459 Telecomunicacoes do Rio de
Janeiro Receipts Pfd. 38,779
2,180,000 Telecomunicacoes do Rio de
Janeiro S.A. Pfd. 327,086
18,330,000 Telecomunicacoes Brasileiras
S.A. 2,481,009
22,900 Telecomunicacoes Brasileiras
S.A. (Sponsored ADR) 3,475,075
------------
16,556,218
------------
CHILE: 3.4%
108,500 Banco de A. Edwards 2,264,938
70,200 Santa Isabel S.A. (Sponsored
ADR) 2,263,950
------------
4,528,888
------------
CHINA: 3.0%
479,200 Huangshan Tourism Development
Co. Ltd. (Class B) 439,906
1,400,000 Shenzhen Fangda Co. Ltd. 2,033,045
1,480,000 Huaneng Power International,
Inc. 1,517,000
------------
3,989,951
------------
EGYPT: 1.9%
1,000 Commercial International Bank 20,919
61,500 Commercial International Bank
(GDR) 1,300,725
21,070 Eastern Tobacco Co. 533,143
33,200 Suez Cement Co. (GDR) 654,040
------------
2,508,827
------------
GREECE: 0.8%
28,000 Hellenic Bottling Co. S.A. 1,033,588
------------
HONG KONG: 13.5%
92,000 Beijing Enterprises Holdings
Ltd. 579,528
548,000 China Everbright-IHD Pacific
Ltd. 1,637,563
600,000 China Light & Power Co. Ltd. 3,400,025
500,000 China Resources Enterprise,
Ltd. 2,452,562
144,000 CITIC Pacific Ltd. Ord. 899,651
271,644 Great Eagle Holdings Ltd. 895,896
916,000 Guangdong Investment Ltd. 1,377,488
560,000 Henderson China Hldg Ltd. 943,333
65,000 Hutchison Whampoa Ltd. 562,153
800,000 Ka Wah Bank 1,037,821
<CAPTION>
NO. OF VALUE
COUNTRY SHARES SECURITIES (A) (NOTE 1)
------------------------------------------------------------
<C> <S> <C>
360,000 Ye(Ng) Fung Hong Ltd. $ 539,047
3,176,000 Qingling Motor Co. 1,639,861
250,000 Swire Pacific Ltd. 2,250,871
------------
18,215,799
------------
HUNGARY: 2.9%
173,600 Euronet Services Inc. 1,920,450
21,100 Gedeon Richter Rt. (Sponsored
GDR) 1,930,650
------------
3,851,100
------------
INDONESIA: 6.2%
404,000 Hanjaya Mandala Sampoerna "F" 1,540,748
1,365,500 PT Bank Bali Bira "F" 2,007,263
1,093,500 PT Bimantara Citra "F" 1,910,927
708,000 PT Ramayaha Lestari Sentosa "F" 2,037,829
70,000 PT Semen Gresik "F" 156,867
423,000 Putra Sarya Multidane 673,982
------------
8,327,616
------------
ISRAEL: 6.7%
740,110 Bank Leumi Le-Israel 1,122,049
20,055 Bank Leumi Le-Israel (Series
4, Option, expiring 8/98) 15,142
20,055 Bank Leumi Le-Israel (Series
3, Option, expiring 12/97) 12,735
80,000 Bio-Technology General Corp. 1,080,000
51,000 Orbotech Ltd. 1,632,000
60,000 Oshap Technologies Ltd. 442,500
71,330 Teva Pharmaceuticals
Industries Ltd. (ADR) 4,618,618
------------
8,923,044
------------
MALAYSIA: 5.4%
380,000 Arab Malaysian Finance Berhad 812,673
393,333 KFC Holdings (Malaysia) Berhad 1,479,867
291,750 Malaysia Assurance Alliance
Berhad 1,698,505
254,000 Tenaga Nasional Berhad 1,237,307
226,000 UMW Holdings Berhad 1,065,109
133,000 United Engineers (Malaysia)
Ltd. 958,653
------------
7,252,114
------------
MEXICO: 10.4%
603,100 Cifra S.A. (ADR) 1,082,565
25,000 Coca-Cola Femsa (ADR) 1,290,625
510,000 Fomento Economico Mexicano,
S.A. de C.V. 3,040,842
100,000 Grupo Financiero Bancomer S.A.
(GDR) 975,000
276,500 Grupo Financiero Bancomer S.A. 2,695,875
134,000 Kimberly-Clark de Mexico S.A.
(ADR) 2,646,500
415,000 Nacional de Drogas S.A. de
C.V. Class "L" 1,415,070
15,700 Telefonos de Mexico S.A. de
C.V. 749,675
------------
13,896,152
------------
PERU: 2.4%
145,564 Credicorp Ltd. (ADR) 3,204,397
------------
</TABLE>
See Notes to Financial Statements.
<PAGE> 6
WORLDWIDE EMERGING MARKETS FUND
STATEMENT OF NET ASSETS
JUNE 30, 1997 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE
COUNTRY SHARES SECURITIES (A) (NOTE 1)
------------------------------------------------------------
<C> <S> <C>
PHILIPPINES: 4.4%
5,924,000 Belle Corp. $ 1,728,979
162,000 Benpres Holdings Corp. (GDR) 1,158,300
26,200 Philippine Long Distance
Telephone Co. 849,086
488,130 San Miguel Ord. (Class B) 1,285,892
2,813,900 SM Prime Holdings Inc. 831,931
------------
5,854,188
------------
POLAND: 1.4%
57,045 Computerland Poland S.A. 1,405,947
50,000 Electrim Spolka Akcyjna 435,113
------------
1,841,060
------------
ROMANIA: 0.4%
48,544 Romanian Growth Fund 485,437
------------
RUSSIA: 11.3%
30,000 Kubanelektrorosvyas Pfd. 604,500
67,300 Leningrad Metals 504,750
7,850 Lukoil Holding (ADR) 612,300
50,700 Lukoil Holdings Pfd. (ADR) 1,292,850
53,450 Mosenergo (ADR) 2,244,900
407 Norilsk Nickel Pfd. (RDC) 2,187,625
335,000 Rostelecom (RDC) 1,299,800
50,000 Surgutneftegaz (ADR) 2,675,000
13,680 Unified Energy Systems 495,079
6,000,000 Unified Energy Systems Pfd. 1,338,000
58,000 Uralmash Preferred Stock 397,300
42,000 UralTelecom 1,417,500
------------
15,069,604
------------
SINGAPORE: 1.1%
404,000 Clipsal Industries Ltd. 1,430,160
------------
SOUTH AFRICA: 0.6%
27,500 Liberty Life Assoc. of Africa
Ltd. 735,625
------------
SOUTH KOREA: 1.0%
130 Korea Mobile Telecom Corp. 96,341
3,461 Korea Mobile Telecom (Warrants
Expiring 12/7/99) 345,851
3,700 Samsung Electronics Co. 407,333
4,200 Sung Mi Telecom Electronics 520,270
------------
1,369,795
------------
THAILAND: 0.5%
134,700 Bangkok Bank Public Co., Ltd. 704,921
------------
TOTAL INVESTMENTS: 92.8% (COST $110,165,087) 124,019,734
OTHER ASSETS LESS LIABILITIES: 7.2% 9,685,132
------------
NET ASSETS: 100.0% $133,704,866
===========
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF SUMMARY OF
INVESTMENTS % OF INVESTMENTS % OF
BY INDUSTRY PORTFOLIO BY INDUSTRY PORTFOLIO
--------- ------- --------- -------
<S> <C> <C> <C>
Auto & Truck 2.2% Oil & Gas 6.0%
Banking/Insurance 7.9% Paper Products 2.1%
Building Materials 2.3% Pharmaceuticals 7.3%
Conglomerates 10.3% Real Estate 2.9%
Consumer 3.2% Retail 4.3%
Financial Services 13.1% Soft Drinks/Beer 4.5%
Food Services 1.6% Supermarkets 0.7%
Infrastructure 0.8% Technology 4.3%
Development
Mail Operator 0.7% Telecommunications 10.5%
Metals/Mining 2.5% Tourism 0.4%
Miscellaneous 0.4% Utilities 11.5%
---------
Motorcycle Financing 0.5% 100.0%
=======
</TABLE>
- ---------------
(a) Unless otherwise indicated, securities owned are shares of common stock.
GLOSSARY:
ADR -- American Depositary Receipt
GDR -- Global Depositary Receipt
RDC -- Russian Depositary Certificate
See Notes to Financial Statements.
<PAGE> 7
WORLDWIDE EMERGING MARKETS FUND
FINANCIAL STATEMENTS (unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1997
<TABLE>
<S> <C>
ASSETS:
Investments at value (identified cost, $110,165,087) (Note 1)..................................................... $124,019,734
Cash.............................................................................................................. 15,939,695
Receivables:
Securities sold.................................................................................................. 1,275,248
Dividends and interest........................................................................................... 369,092
Capital shares sold.............................................................................................. 147,414
Due from broker (Note 4)......................................................................................... 144,231
Deferred organization costs....................................................................................... 5,227
------------
Total assets................................................................................................. 141,900,641
------------
LIABILITIES:
PAYABLES:
Securities purchased............................................................................................. 7,375,423
Capital shares redeemed.......................................................................................... 562,381
Accounts payable................................................................................................. 257,971
------------
Total liabilities............................................................................................ 8,195,775
------------
Net assets........................................................................................................ $133,704,866
==============
Shares outstanding................................................................................................ 8,746,465
==============
Net asset value, redemption price and offering price per share.................................................... $ 15.29
==============
Net assets consist of:
Aggregate paid in capital........................................................................................ $119,011,563
Unrealized appreciation of investments, equity swaps and foreign currency........................................ 13,998,501
Undistributed net investment income.............................................................................. 65,799
Undistributed realized gains..................................................................................... 629,003
------------
$133,704,866
==============
</TABLE>
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE FOR THE
SIX MONTHS EIGHT MONTHS
ENDED ENDED
JUNE 30, 1997 DECEMBER 31,
(UNAUDITED) 1996
------------------------- ----------------------
<S> <C> <C> <C> <C>
INCOME: (NOTE 1)
Dividend Income (net of foreign taxes withheld of $27,172 and
$41,511, respectively).............................................. $771,105 $9,620
Interest income...................................................... 2,765 173
----------- --------
773,870 9,793
EXPENSES:
Management (Note 2).................................................. $398,096 $13,193
Administration (Note 2).............................................. 1,529 236
Professional......................................................... 28,292 9,388
Custodian............................................................ 16,800 6,744
Trustees fees and expenses........................................... 15,016
Reports to shareholders.............................................. 23,006 2,158
Registration......................................................... 16,246 --
Amortization of deferred organization costs (Note 1)................. 744 1,007
Other................................................................ 25,454 2,279
-------- --------
Total expenses.................................................. 525,183 35,005
Expenses assumed by the Advisor and/or reduced by a custodian fee
arrangement (Note 2)................................................ (18,137) (35,005)
-------- --------
Net expenses.................................................... 507,046 --
----------- --------
Net investment income........................................... 266,824 9,793
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (NOTE 3):
Realized gain from security transactions............................. 497,032 142,431
Realized loss from foreign currency transactions..................... (35,871) (3,503)
Realized loss on options............................................. (16,771) --
Change in unrealized depreciation of foreign currency receivables and
payables............................................................ 38 (733)
Change in unrealized appreciation of investments and equity swaps.... 13,837,354 124,384
----------- --------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................. $14,548,606 $272,372
============= ==========
</TABLE>
See Notes to Financial Statements.
<PAGE> 8
WORLDWIDE EMERGING MARKETS FUND
FINANCIAL STATEMENTS (unaudited)
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE FOR THE
SIX MONTHS FOR THE PERIOD
ENDED EIGHT MONTHS DECEMBER 21,
JUNE 30, ENDED 1995+ TO
1997 DECEMBER 31, APRIL 30,
(UNAUDITED) 1996 1996
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income............................................................ $ 266,824 $ 9,793 $ 3,557
Realized gain from security transactions......................................... 497,032 142,431 6,311
Realized loss from foreign currency transactions................................. (35,871) (3,503) (62)
Realized loss on options......................................................... (16,771) -- --
Change in unrealized depreciation of foreign currency receivables and payables... 38 (733) 317
Change in unrealized appreciation of investments and swaps....................... 13,837,354 124,384 37,141
------------ ------------ ------------
Increase in net assets resulting from operations................................. 14,548,606 272,372 47,264
------------ ------------ ------------
Dividends to shareholders from:
Net investment income............................................................ (171,583) (3,356) --
------------ ------------ ------------
Capital share transactions*:
Net proceeds from sales of shares................................................ 127,869,086 14,591,092 550,000
Reinvestment of dividends........................................................ 171,583 3,356 --
------------ ------------ ------------
128,040,669 14,594,448 550,000
Cost of shares reacquired........................................................ (24,067,847) (105,707) --
------------ ------------ ------------
Increase in net assets resulting from capital share transactions................... 103,972,822 14,488,741 550,000
------------ ------------ ------------
Total increase in net assets................................................. 118,349,845 14,757,757 597,264
NET ASSETS:
Beginning of period................................................................ 15,355,021 597,264 --
------------ ------------ ------------
End of period (including undistributed net investment income of $65,799, $6,429 and
$3,433, respectively)............................................................ $133,704,866 $15,355,021 $597,264
=========== ============ ============
*SHARES OF BENEFICIAL INTEREST OUTSTANDING WITH AN UNLIMITED NUMBER OF $.001 PAR
VALUE SHARES AUTHORIZED ISSUED AND REDEEMED:
Shares sold...................................................................... 9,221,542 1,183,568 54,566
Reinvestment of dividends........................................................ 12,616 294 --
------------ ------------ ------------
9,234,158 1,183,862 54,566
Shares reacquired................................................................ (1,717,565) (8,556) --
------------ ------------ ------------
Net increase..................................................................... 7,516,593 1,175,306 54,566
=========== ============ ============
- ---------------
+ Commencement of operations.
</TABLE>
See Notes to Financial Statements.
<PAGE> 9
WORLDWIDE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
For a share outstanding throughout each period
<TABLE>
<CAPTION>
FOR THE FOR THE
SIX MONTHS FOR THE PERIOD
ENDED EIGHT MONTHS DECEMBER 21,
JUNE 30, ENDED 1995(A) TO
1997 DECEMBER 31, APRIL 30,
(UNAUDITED) 1996 1996
---------- ------------- ------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period....................................... $ 12.49 $ 10.95 $ 10.00
------ ------ --------
Income From Investment Operations:
Net Investment Income (b)................................................ 0.06 .01 0.07
Net Gains on Securities (both realized and unrealized)................... 2.79 1.59 0.88
------ ------ --------
Total From Investment Operations........................................... 2.85 1.60 0.95
------ ------ --------
Less Distributions:
Distributions from net investment income................................. (0.05) (0.06) --
------ ------ --------
Net Asset Value, End of Period............................................. $ 15.29 $ 12.49 $ 10.95
====== ====== ========
Total Return (c)........................................................... 22.87% 14.66% 9.50%
- ---------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTARY DATA
Net Assets, End of Period (000)............................................ $133,705 $15,355 $ 597
Ratio of Gross Expenses to Average Net Assets (d).......................... 1.32% 2.64% 2.06%
Ratio of Net Expenses to Average Net Assets (d)............................ 1.27% 0.00% 0.00%
Ratio of Net Income to Average Net Assets (d).............................. 0.67% 0.74% 1.89%
Portfolio Turnover Rate.................................................... 25.55% 29.53% 45.89%
Average Commission Rate Paid............................................... $0.0015 $0.0029 $ 0.0124
</TABLE>
- ---------------
(a) Commencement of operations.
(b) Based on average shares outstanding.
(c) Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of dividends at net
asset value during the period and a redemption on the last day of the
period. Total returns for the periods of less than one year ended were not
annualized.
(d) Annualized.
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
Van Eck Worldwide Insurance Trust (the "Trust"), organized as a Massachusetts
business trust on January 7, 1987, is registered under the Investment Company
Act of 1940. The following is a summary of significant accounting policies
consistently followed by the Worldwide Emerging Markets Fund series, a
diversified fund (the "Fund"), of the Trust in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles. The preparation of financial statements in conformity with generally
accepted accounting principles requires the use of management's estimates, and
the actual amounts could differ.
A. SECURITY VALUATION--Securities traded on national exchanges and traded in the
NASDAQ National Market System are valued at the last sales prices reported at
the close of business on the last business day of the period. Over-the-counter
securities not included in the NASDAQ National Market System and listed
securities for which no sale was reported are valued at the mean of the bid and
asked prices. Short-term obligations purchased with more than sixty days
remaining to maturity are valued at market. Short-term obligations purchased
with sixty days or less to maturity are valued at cost which with accrued
interest approximates value. Securities for which quotations are not available
are stated at fair value as determined by the Board of Trustees.
B. FEDERAL INCOME TAXES--It is the Fund's policy to comply with the provisions
of the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders. Therefore, no federal
income tax provision is required.
C. CURRENCY TRANSLATION--Assets and liabilities denominated in foreign
currencies and commitments under forward currency contracts are translated into
U.S. Dollars at the mean of the quoted bid and asked prices of such currencies
on the last business day of the period. Purchases and sales of investments are
translated at the exchange rates prevailing when such investments were acquired
or sold. Income and expenses are translated at the exchange rates prevailing
when accrued. The portion of realized and unrealized gains and losses on
investments that result from fluctuations in foreign currency exchange rates is
not separately disclosed. Recognized gains or losses attributable to foreign
currency fluctuations on foreign currency denominated assets and liabilities are
recorded as net realized gains and losses from foreign currency transactions.
D. DIVIDENDS AND DISTRIBUTIONS--Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Income distributions and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
E. OTHER--Security transactions are accounted for on the date the securities are
purchased or sold. Interest income is accrued as earned.
F. Deferred organizational costs are being amortized over a period not to exceed
five years.
<PAGE> 10
WORLDWIDE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
NOTE 2--Van Eck Associates Corporation earned fees of $348,096 for the six
months ended June 30, 1997 for investment management and advisory services. The
fee is based on an annual rate of 1% of the average daily net assets, which
includes the fee paid to the Advisor for accounting and administrative services.
For the period January 1, 1997 to January 10, 1997, Van Eck Associates
Corporation agreed to waive its management fees and assume all expenses of the
Fund except interest, taxes, brokerage commissions and extraordinary expenses.
For the period January 11, 1997 to February 4, 1997, the Adviser agreed to waive
expenses exceeding 1% of average daily net assets. Certain of the officers and
trustees of the Trust are officers, directors or stockholders of Van Eck
Associates Corporation and Van Eck Securities Corporation.
In accordance with the advisory agreement, the Fund reimbursed Van Eck
Associates Corporation $1,529 for costs incurred in connection with certain
administrative and operating functions.
The Fund has a fee arrangement, based on cash balances left on deposit with the
custodian, which reduces the Fund's operating expenses.
NOTE 3--Purchases and sales of securities, other than short-term obligations,
aggregated $116,113,783 and $17,838,795, respectively, for the six months ended
June 30, 1997. For federal income tax purposes, the identified cost of
investments owned at June 30, 1997 was $110,165,087. As of June 30, 1997, net
unrealized appreciation for federal income tax purposes aggregated $13,854,647,
of which $18,000,088 related to appreciated securities and $4,145,441 related to
depreciated securities.
NOTE 4--The Fund entered into the following equity swaps to gain investment
exposure to the relevant market of the underlying securities. A swap is an
agreement that obligates the parties to exchange cash flows at specified
intervals. In the case of the following swaps, the Fund is obligated to pay the
counterparty on trade date an amount based upon the value of the underlying
instrument and, at termination date, final payment is settled based on the value
of the underlying securities on trade date versus the value on termination date
plus accrued dividends.
Risks may arise as a result of the failure of the other party to the contract to
comply with the terms of the swap contract. The losses incurred on the following
swaps are limited to the payments made on the purchase date by the Fund.
Therefore, the Fund considers the credit worthiness of each counterparty to a
swap contract in evaluating potential credit risk. Additionally, risks may arise
from unanticipated movements in the value of the swaps relative to the
underlying securities.
The Fund records a net receivable or payable daily, based on the change in the
value of the underlying securities. The net receivable or payable for financial
statement purposes is shown as due to and from broker. The realized losses from
equity swaps is included in realized gain from security transactions. For the
six months ended June 30, 1997, the Fund had realized loss of $16,771 from
equity swaps.
At June 30, 1997, the Fund had the following outstanding swaps with a single
counterparty (stated in U.S. dollars):
<TABLE>
<CAPTION>
UNREALIZED
UNDERLYING NUMBER OF NOTIONAL TERMINATION APPRECIATION
SECURITY SHARES AMOUNT DATE (DEPRECIATION)
- -------------- --------- ---------- -------------- --------------
<S> <C> <C> <C> <C>
Associated
Cement
Companies
Ltd. 30,000 $1,153,485 June 26, 1998 $ 18,609
Asian Paints
India Ltd. 500 1,061,130 May 2, 1998 195,324
Tata
Engineering
and
Locomotive
Company 3,000 1,339,067 June 26, 1998 (69,702)
--------------
Total appreciation $144,231
=================
</TABLE>
NOTE 5--The Fund may purchase securities on foreign exchanges. Securities of
foreign issuers involve special risks and considerations not typically
associated with investing in U.S. issuers. These risks include devaluation of
currencies, less reliable information about issuers, different securities
transactions clearance and settlement practices, and future adverse political
and economic developments. These risks are heightened for investments in
emerging market countries. Moreover, securities of many foreign issuers and
their markets may be less liquid and their prices more volatile than those of
comparable U.S. issuers.
NOTE 6--The Fund invests in warrants whose values are linked to indices or
underlying instruments. The Fund uses these warrants to gain exposure to markets
that might be difficult to invest in through conventional securities. Warrants
may be more volatile than their linked indices or underlying instruments.
Potential losses are limited to the amount of the original investment.
NOTE 7--TRUSTEE DEFERRED COMPENSATION PLAN--The Trust established a Deferred
Compensation Plan (the "Plan") for trustees. Commencing January 1, 1996, the
Trustees can elect to defer receipt of their trustee fees until retirement,
disability or termination from the board. The Fund's contributions to the Plan
are limited to the amount of fees earned by the participating trustees. The fees
otherwise payable to the participating trustees are invested in shares of the
Van Eck Funds as directed by the trustees. The Plan has been approved by the
Internal Revenue Service.
As of June 30, 1997, the total value of the assets and corresponding liability
of the Fund's portion of the Plan is $3,178.
<PAGE> 11
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<PAGE> 12
[Van Eck Global Border]
VAN ECK WORLDWIDE June 30, 1997
INSURANCE TRUST
-------------------------
VAN ECK
WORLDWIDE EMERGING WORLDWIDE
MARKETS FUND INSURANCE TRUST
SEMI-ANNUAL REPORT
WORLDWIDE
EMERGING MARKETS
FUND
VAN ECK WORLDWIDE INSURANCE TRUST
- ------------------------------------
99 Park Avenue, New York, NY 10016
This report must be accompanied or
preceded by a prospectus, which
includes more complete information,
such as charges and expenses and
the risks associated with
international investing, including
currency fluctuations or controls,
expropriation, nationalization and
confiscatory taxation. Please read
the prospectus carefully before
investing.
FR1997-0722-0002
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